Home > political-economy, shorter work time > Class War in Madison? Not so fast… (Final thoughts)

Class War in Madison? Not so fast… (Final thoughts)

The argument i have tried to make in the previous parts of this series ( one, two, three and ) is simple: What is taking place in the battle in Wisconsin, and the battle against austerity generally has nothing to do with Capital directly, but instead is concerned with the massive population of working people rendered completely redundant by the progress of Capital’s development, and a huge mass of capital that must stand idle as a result of this progress. The specific problem at hand is that under existing social conditions this idle capital and redundant population can only be employed if the capital is wasted, consumed unproductively and absorbed by a population of working people whose daily labor creates nothing, satisfies no human need — not even their own.

This catastrophe expresses itself, first, in the monstrously bloated body of the State that grows to such proportion that it chokes off the employment of the productive capacity of society; and, second, that the State, however bizarrely swollen — as can be seen in the US accounting for 48% of global defense expenditures — is still not bloated enough; that it has not, despite the glaring obscenity of such wasteful spending in the face of growing poverty, grown to the proportion necessary to ensure the continuing purchase and sale of labor power, i.e., to ensure employment of capital for the extraction of surplus value.

The first aspect of this crisis, however, can only be resolved by the further expansion of the State — on pain of a growing class conflict and to suppress this conflict — and not through austerity. So it is not surprising that politicians, acting under the slogan “Jobs, Jobs, Jobs”, blindly offer every manner of silly and contradictory policies to effect this expansion: tax increases and tax reductions; new public debt issues and urgent calls to balance the budget; committees formed composed of senior politicians and academics, corporate CEOs, and wealthy contributors to discuss “investment” in public education, infrastructure and new technologies said to offer society the opportunity to “win the future”, and, at the same time, efforts to dismantle existing State public services, and protections for workers and the environment. In short, a relentless effort by the capitalists to dump the entire burden of the crisis onto the shoulders of working women and men; and, an equally vigorous struggle by working people to avoid this burden.

The second aspect of this crisis places a material demand on the State to increase its burden on society. For all the bleating of politicians about how the country must increase its competitiveness the State grows, but it grows in a way that does not add to the productive capacity of society in any fashion. The nation must become poorer not richer as a result of this growth, less productive, less competitive, more dependent on imports from nations where the continuing employment of oxen in agriculture is not uncommon, and where — owing to the low productivity of labor — daily wages are a fraction of the American average hourly wage.

The method employed by the State to increase its size and overcome the rising antagonism between production and consumption, no matter whether the method adopted is the issuance of new public debt — as advocated by Keynesians like Paul Krugman — or the wholesale creation of new money directly through State expenditures — as advocated by Modern Monetary Theorists like Billy Mitchell — is depreciation of money; a depreciation that is only possible because the State previously debased money from the gold standard.

No other object in society touches on commodities more intimately than the ratio by which these commodities exchange for money itself. Absent crises, Capital presents itself in the form of the ceaseless, uninterrupted, and expanding dense network of interrelated transactions whereby money and commodities are exchanged — and within which any particular commodity may pass through many such transactions before falling out of circulation and being consumed.

However, what concerns every member of society is that she receives some definite amount of money in return for her commodity. If she is a worker, she seeks only an agreed upon wage; if she is a capitalist, she seeks only a return of her capital plus an average rate of profit in the form of some definite quantity of money. With its authority to determine what serves as money, the State can “purchase” the labor power of a worker, or the commodity of the capitalist by exchanging these commodities for money created out of thin air.

Thus, the ratio between the sum of money in circulation and the sum of commodities in circulation is upset in proportion to the injection of the new ex nihilo pecuniam; while, on the other hand, a portion of the existing capital and labor power in circulation is consumed without being replaced. The total sum of commodities in circulation are reduced, and the prices of the remaining commodities increase. In this way, both the existing capital and labor power are devalued simultaneously and together in proportion as the expenditures of the State increase.

Yet, despite this devaluation of the existing capital and labor power by the State, it should not be forgotten that devaluation must take place on any account. It is not the State that forces this devaluation on Capital, but Capital which forces it on itself. The antagonism between the conditions of production and those of consumption are such that without this devaluation Capital would altogether collapse in on itself.

The fact stands as follows: the problem posed by the antagonism between the conditions under which society produces and consumes cannot be resolved in any way other than a general reduction of hours of work. Absent this general reduction of hours of work it becomes necessary for the State to increase its expenditures of wholly superfluous employment of both capital and labor power — to devalue both through inflation in order to overcome the contradictions inherent in the capitalist mode of production itself.

We who favor a stateless society should be absolutely clear on these points and never back down from them:

First, the State does not grow to care for the sick, feed the hungry, or add to and repair the roads, bridges and communications of society. It grows DESPITE these pressing social needs. Only by wasting productive resources on an ever increasing scale can any economic activity take place on the existing basis — the State indeed grows, but so do all of these nagging social ills.

Second, thirty million are unemployed not because there is no work to be done, but because it is not profitable to do those things that need to be done given the overly long hours work mandated by law. Factories are shuttered not because there is no need for their products, but because satisfying those needs intensifies the problem of recovering the capital laid out in their production plus an average rate of profit. The further expansion of the State addresses these problems only by intensifying them — by bringing into still greater antagonism the contradiction between production and consumption.

Should the thirty million unemployed find jobs it is only on the basis that their addition to the labor force comes directly or indirectly at the expense of the wages of the already employed 130 million, such that this larger labor force of 160 million now enjoy no more wages (or even less wages) than the 130 million did before — that the total wages formerly shared by the 130 million is now shared by 160 million, so that each suffers a proportional drop in their material standard of living.

There is no route out of this crisis through State economic policy: not through senseless battles to defend the coddled unions in the public sector, nor by stupid progressive slogans to tax the rich. The struggle against austerity cannot be won by defending the public unions, nor by silly attempts hold the line on public budget cuts or increase State expenditures. Only by reducing hours of work can we extricate ourselves from the deepening crisis of Capital and the relentless expansion of the repressive, aggressive and parasitic State.

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  1. November 12, 2013 at 8:33 am | #1

    I must confess I read only bits of three of your long posts. Found this blog by googling ex nihilo.
    May I ask do you also write about WHO does the creatin’?
    http://www.banks-need-boundaries.net/do_banks_really_create_money.php

    And what about the separation of ‘investment banks’
    http://www.positivemoney.org/2013/09/reforming-the-structure-of-the-eu-banking-sector/

    Would be interested to hear your take on those two points.

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